Broadcom stock drops after loss

Broadcom on Tuesday reported a $251 million net loss for its latest quarter, due in part to a $501 million charge related to its February 2012 acquisition of NetLogic for $3.7 billion.

The Irvine chipmaker's stock fell 4.3 percent, to $31.83 a share, on speculation that slowing smartphone sales and a shift to other suppliers by Apple and Samsung might cut into its sales.

Broadcom said it generated $2.09 billion in revenue for the three months ending June 30, up 6 percent over the same period in 2012. Cash flow from operations was $334 million compared with $349 million a year ago.

Wireless chips have increasingly become the primary driver of Broadcom's business, accounting for roughly half of revenue. The stock price drop came on reports that Qualcomm was integrated into Samsung's lower end phones instead of Broadcom's pervasive Wi-Fi and Bluetooth chips.

The reports out there "don't point out all the models we've won," said Broadcom CEO Scott McGregor. He also said customers "may choose an inferior part just to keep some diversity in their supply chain."

Broadcom expects third-quarter revenue to come in between $2.05 billion and $2.2 billion as the company continues pushing faster fifth-generation 802.11ac Wi-Fi chips across a variety of devices. The rollout of the new technology could help spur consumers to upgrade other gadgets in their home to faster Wi-Fi chips, many of which are also likely to be Broadcom-powered.